Article from ‘Parks Business’ spring 2020 issue, page 10.
This is a rapidly evolving situation which the NCC is monitoring carefully. It is critical that members keep under constant review the advice and guidance issued by Government. The NCC is creating a members’ COVID-19 information hub, which will be available online shortly.
Business Rates Holiday for Retail, Hospitality and Leisure
Businesses in the retail, hospitality and leisure sectors in England will not have to pay business rates for the 2020-21 tax year.
Your business will be eligible if it is based in England* and is in the sectors mentioned above (including dealerships).
Businesses do not need to act as local authorities will apply the business rates holiday to bills. This will apply to rates bills for the 2020/2021 tax year (local authorities may have to reissue bills).
*Some aspects of business support are devolved. For business support outside of England, there is separate information for Scotland, Wales and Northern Ireland. Information can be accessed from www.businesssupport.gov.uk/coronavirus-business-support/
Large Business Interruption Loan Scheme
The new Coronavirus Large Business Interruption Loan Scheme (CLBILS) will provide a government guarantee of 80% to enable banks to make loans of up to £25m to firms with an annual turnover of between £45m and £500m. Facilities backed by a guarantee under CLBILS will be offered at commercial rates of interest.
Government expects the scheme to be delivered through commercial lenders. Lenders will still be expected to conduct their usual credit risk checks, but this scheme allows them to specifically support business that were viable before the COVID-19 outbreak but are facing significant cash flow difficulties that would make their business unviable in the short term.
The new scheme is expected to launch later in April, allowing businesses to access finance products including short-term loans, overdrafts, invoice finance and asset finance. Businesses remain responsible for repaying any facility they may take out.
SME Coronavirus Business Interruption Loan Scheme
The first Coronavirus Business Interruption Loan Scheme was announced to support small and medium-sized businesses with an annual turnover of up to £45m. This was so they could access loans, overdrafts, invoice finance and asset finance of up to £5 million for up to six years.
The scheme will be delivered through commercial lenders, backed by the Government owned British Business Bank. The Government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will also make a Business Interruption Payment to cover the first 12 months of interest payable and any lender-levied fees, so businesses will benefit from no upfront costs and lower initial repayments.
In response to feedback received since the scheme’s launch, the Chancellor is taking further action by extending the scheme so that all viable small businesses affected by Covid-19, and not just those unable to secure regular commercial financing, will now be eligible. There are some 40 accredited lenders able to offer the scheme, including all the major banks. Government expects the scheme to run for an initial period of six months. There is no limit on the capacity of the scheme.
Job Retention Scheme (JRS)
Guidance on the rules relating to the JRS and furloughing has been published by Government. The NCC has provided its members with information taken from the relevant Government websites and expert sources. NB members are advised that they must take their own advice on how this applies to them, their staff and their individual circumstances.
Eligibility: the scheme is open to all UK employers that had a PAYE payroll scheme for employees in place on 28 February 2020; to qualify the employee must have been on the payroll on any form of contract including Zero Hour Contracts and agency contracts. (Employees hired after this date are not eligible.)
Anyone who was on payroll on 28 February 2020 but was then made redundant can be rehired and put on the Scheme.
Who can apply: Any employer can apply – and can (from end of April) use a portal to claim up to 80% of wage costs up to a cap of £2,500 per month for all furloughed employees (employees on a leave of absence) plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage. Any fees, commissions and bonuses are not included.
The 80% calculated is to be based on the employee’s pre-tax salary. Employers can choose to top to the payment to 100% but are not obliged to (subject to employment law and renegotiating any contractual entitlements).
Closure of parks
The Prime Minister announced on Monday 23 March that with immediate effect everyone in the UK is ordered to stay at home to stop COVID-19 from spreading.
This resulted in the enforced closure of caravan parks and campsites. Police forces now have the powers to enforce these rules through fines and dispersal orders if people do not adhere to the guidance. This followed earlier Government advice that travelling to a second holiday home or to a caravan park is regarded as NONESSENTIAL travel.
Owners self-isolating or at risk
There are exceptions, however – see article ‘CLG update for residential or holiday parks and COVID-19’ for details. In essence, holiday caravan owners/occupants that do not have a permanent residence in the UK can remain in their caravan.
Parks are advised to make contact with their Local Authority Site Licensing Officer/Department regarding such ‘resident owners’ so the park is not subject to any subsequent enforcement measures by the local authority.
If it is not possible and safe for the caravan owner to return home, then they can self-isolate in their caravan, but they must follow the Government guidelines on self-isolation.
Owners on park that are identified as being in one of the ‘at risk’ groups announced by Government should provide the park with evidence. Parks should record this in writing.
Insurance
Where businesses have insurance cover for pandemics and Government-ordered closure, this should allow them to make a claim on their policies as long as all other terms and conditions are met. Insurance policies differ significantly, so businesses are encouraged to check the terms and conditions of their specific policy and to contact their providers.
Most businesses are unlikely to be covered, as standard business interruption policies are dependent on damage to property and will exclude pandemics.
Owners and staff falling ill
If owners or staff contact the park management or reception to report virus symptoms while on the park, or in the course of their employment at the park, then they should be advised to follow the government advice online at www.111.nhs.uk or by calling 111. Staff should be told to leave the park immediately if possible and self-isolate at home.
Cancellations by those with bookings
If it is not possible to transfer a booking to a later date, then the customer may be entitled to a full or partial refund.
Parks should consider any reputational risk in keeping strictly to what their terms and conditions might say. In such circumstances, parks need to check the terms and conditions of their bookings carefully, including whether there is a ‘force majeure’ clause and if there is, what it says.
Pitch fee refunds/credits
Refunds/credits are usually dictated by the terms of the licence agreement between the park and the holiday caravan owner and will usually only apply if the licence agreement is terminated (either by the owner or the park). Park management will need to consider whether to offer some form of compensation or other easement to holiday caravan owners to cover the period the park and its facilities are not available.
Holiday caravan owners pay a contribution towards the park’s business rates, which have been waived for the current year. If this contribution has already been paid by holiday caravan owners, this will need to be refunded.
The NCC is taking legal advice on behalf of all sectors of membership on the issue of deposit returns/refunds.